Indiana tax burden — broken down.
Indiana’s combined tax burden (income + property + sales) lands at 10.87% on our composite — ranking #26 of 51 jurisdictions. The top marginal individual income tax rate is 3.00%.
Indiana burden, broken into 3 components
| Component | Indiana rate | National median |
|---|---|---|
| Top marginal income | 3.00% | ~5.30% |
| Effective property | 0.87% | ~1.07% |
| State sales tax | 7.00% | ~5.50% |
| Combined composite | 10.87% | ~11.87% |
National medians from CalcFi’s 51-state composite. Top marginal is the headline single-filer rate, NOT the effective rate most households actually pay.
Retirement + Social Security in Indiana
Indiana taxes most retirement income (pensions, IRA / 401(k) distributions). Social Security benefits are NOT taxed by Indiana. Federal taxation of these income sources is unchanged regardless of state.
How Indiana compares
Of all 51 US jurisdictions ranked by combined burden composite, Indiana sits at #26. That places Indiana in the middle of the pack — burden is moderate without being a particular outlier in either direction. For the live cross-state heat map, see the interactive tax burden map.
Indiana metros — local tax overlay
State rates are uniform across Indiana— but local income, property, and sales taxes vary. Click any metro to run the full income tax calculator pre-populated with that city’s local layer.
- Indianapolisproperty 0.83% · pop 2.1Mmedian $64,200 →
- Fort Wayneproperty 0.83% · pop 0.4Mmedian $57,600 →
- Evansvilleproperty 1.00% · pop 0.3Mmedian $48,500 →
More Indiana metros coming as we expand city coverage.
Indiana tax — common questions
What is the Indiana top marginal income tax rate in 2025?
Indiana's top marginal individual income tax rate is 3.00% on the highest bracket.
What is the Indiana effective property tax rate?
Indiana's statewide effective property tax rate is 0.87% of home value (annual). On a $400,000 home that's roughly $3,480/yr. Local variation can be ±0.5pp.
Does Indiana tax retirement income or Social Security?
Indiana taxes most retirement income, and does NOT tax Social Security benefits.
Are there any Indiana-specific tax quirks I should know about?
IN flat rate scheduled to drop to 2.9% by 2027 — would tie for lowest flat income tax. Combined with county taxes, effective rate still 4–6%.
Reviewed by CalcFi Editorial · Source: Tax Foundation State Individual Income Tax Rates (Jan 2025). Last verified 2026-04-19. Methodology at /about/editorial.